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Q&A - Breaking Down The Wall: Market Access in China
We speek to Chia Wen Lee - Head of Emerging Markets Access for Biogen Idec - about the current landscape in lucrative China, the reality of the Essential Drugs List and the best approach for big pharma into this complex marketplace…
In anticipation of our upcoming Emerging Markets conference in Europe, we spoke to Chia Wen Lee - Head of Emerging Markets Access for Biogen Idec - about the current landscape in lucrative China, the reality of the Essential Drugs List and the best approach for big pharma into this complex marketplace…
Hi Chia, thanks for joining us.
Can you begin by telling me a little bit about your role?
I support all emerging markets departments on any market access related issues. For Biogen the emerging markets include everywhere outside of North America and Western Europe.
Because we are new to the geography we have a mixture of commercial structures, for the major markets we have local offices. And in some of the countries we have distributers, and in some we have partners - so it's a very mixed bag.
So quite a broad role then in terms of responsibility?
Yes very broad.
Looking back over the past few years in China, and forwards towards the next few, how do you feel the healthcare landscape has changed and where do you see it going?
In 2009, China issued their sweeping healthcare reform bill, it was a very big document outlining some specifics and when it was first published it was not clear how they were going to implement it.
Now four or five years on, they break it down into components so they can prioritise. China is in a very different place than most mature markets.
Most global markets are looking to manage the budget and cut down cost, but China has some spare money, so they're looking into more streamlinedpricing reimbursement and budget control, that type of thing. They are also talking about how to appropriately reward and stimulate innovation. It's basically looking like a pyramid of different levels of technology and pharmaceuticals so at the very basic level like generics or essential drugs they want to streamline the pricing and make sure quality and drug safety is well controlled and tightly regulated.
If we go more and more up to the top of the pyramid - that's more the biologics and innovative medications - and they are looking really to stimulate innovation, either from overseas or domestic innovation.
They have very clear national policy for that. And I see increasingly joint ventures set up among the international companies and some local Chinese companies, I sometimes see that as a 50/50 split and sometimes it's 49/5. Neither is easy, but I see a lot more joint ventures because the policy packs incentive.
What do you consider the main barriers to entry in the Chinese marketplace?
The first hurdle is obviously the regulatory one, the registration; but it depends on what kind of assets you’re talking about. If it's biologics then you're looking at many, many years; if it's a chemical compound it's shorter, but the regulatory approval timeline in China is lengthier than most other countries.
So that's the first thing, and the requirement of registration is very different from, say, neighbours like Korea or even Japan, they require different data.
Second is to find out or to figure out what the regulatory requirement is early on, that’s very important. Having some local expertise to connect you to the right part of the SFDA and manage the expectation is also very important. And make sure that if some Chinese data is required then you want to include the patients early on.
It's very important that if you want to run trials in China, the sites have to be SFDA approved. I've experienced issues where we collected some patients from Hong Kong and we hoped that was sufficient, but when we checked then we realised none of the sites in Hong Kong were SFDA approved - so you've got to make sure that you understand the local requirements.
Would you say public reimbursement is the best option for foreign pharma looking to grow in China?
So you could succeed exclusively by pursuing private reimbursement?
The reimbursement concept in China is very different from the classic process. If you think in terms of central European approach where if you come in with a new pharmaceutical and either you’re reimbursed or not, once you're reimbursed you're accepted by the majority of countries.
In China it's a very different concept. And it's very rare for any newly launched products to be reimbursed and the unspoken rule is that the product has to be on the market for at least two years. That's to make sure that there's enough people experienced on the ground, it's not like "Okay we're going to launch so we're going to go through the reimbursement process."
They also have a kind of “across the board” reimbursement review and the timeline is very fixed, it's usually like four or five years. When they first started in 2000, well 1999, they said every other year, that was the ambition, but it never happened that way. It was usually like four or five years. So there's no way you can get reimbursed or reviewed in between, not at the national level.
And if you are being listed at the national level then you go into the provisional reimbursement list automatically but if you are list-free then you still have to go through the legal provinces for reimbursement.
That's, I would say, for most of the foreign companies with high-priced products, probably wiser - not to blindly pursue national reimbursement. It’s a lot wiser to pursue individual province reimbursement. And of course when you go into the national reimbursement list, you face a lot more pricing pressure.
The Emerging Markets Summit 2012 will be taking place at the five star luxury Kempinski Hotel in Berlin on the 12th& 13thNovember, for more information you candownload our brochure at http://bit.ly/QtV6Yc.
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